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National Food Authority Bill 1991



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House: House of Representatives

Portfolio: Aged, Family and Health Services

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Purpose

To establish the National Food Authority (NFA) which will develop and review food standards, advise the Minister on matters relating to food and develop industry codes of practice.

Background

The food, beverage and tobacco processing industry sector is the largest manufacturing sector in Australia. In 1987-88, the sector accounted for more than 20% of manufacturing sales ($27 billion) and more than 16% of manufacturing sector employment (172 000 persons). There were approximately 3900 food processing and beverages businesses in 1987-88. In 1987-88, 31% of all businesses were located in Victoria, 27% in N.S.W. and 18% in Queensland. Imports of processed food and beverages have risen by 25.5% between 1984-85 and 1988-89 (the value of imports in 1988-89 totalled $1.773 billion). Exports of processed food and beverages have risen by 35.5% between 1984-85 and 1988-89 (the value of exports in 1988-89 totalled $1.984 billion). Australia's major processed food exports are meat and fish products, dairy products and sugar. The main markets for Australia's exports are Japan which accounted in 1988-89 for 27% of processed food and beverage exports, followed by the US with 16%.

The production and sale of processed food and beverages in Australia is controlled by a complex set of overlapping Commonwealth and State legislation and regulations. Most of the legislative controls imposed on the processed foods and beverages industry exist at State and local government levels and enforcement is undertaken by a very large number of State agencies. Commonwealth involvement in food and beverages regulation occurs principally through involvement in the national Food Standards Code (FSC), import/export standards setting, and import/export inspection. The FSC prescribes the quality and labelling of processed foods and beverages. These standards are adopted at Commonwealth/State level either by Gazettal or by amendment to State food regulations.

The administrative structures and processes for the review of food and beverages standards are complex. This complexity is graphically illustrated by the review procedures for the FSC. The Australian Food Standards Committee (AFSC) is responsible for reviewing the FSC and for making recommendations on changes to the FSC. The AFSC comprises representatives of Commonwealth, State and Territory health authorities; the National Health and Medical Research Council (NHMRC); food manufacturers and importers; the Australian Federation of Consumer Organisations (AFCO); the Department of Primary Industries and Energy; the Department of Industry, Technology and Commerce; and technical and professional experts. The recommendations of the AFSC are considered by the Public Health Committee (PHC) of the NHMRC. The PHC consists of representatives of Commonwealth, State and Territory health authorities; the ACTU; the Confederation of Australian Industry; AFCO; the Federal Bureau of Consumer Affairs; and technical and professional experts. Recommendations endorsed by the PHC then proceed to the National Foods Standards Council (NFSC), which comprises Commonwealth, State and Territory Ministers responsible for food standards. When approved by the NFSC, proposed changes to the FSC are published in the Commonwealth Gazette. Gazettal gives effect to proposed FSC amendments in Queensland, South Australia, Tasmania and the Northern Territory, while in New South Wales, Victoria and Western Australia amendments to regulations give effect to proposed FSC amendments. The AFSC is assisted in the development and review of food and beverages standards by three subcommittees and working parties, the Uniform Food Law Interpretation Committee, the Nutrition Committee of the NHMRC and the Pesticides and Agricultural Chemicals Committee.

The processed food and beverages industry was examined by the Industries Assistance Commission (the Commission) in 1988-89. The findings of the Commission included that:

*the current system of food standards provides consumers with a degree of protection and information about foods purchased;

*the complex web of regulations impedes manufacturers and delays the introduction of new foods and new technologies; and

*the acceptance by the States of the FSC has been a major advance but other elements of State food law perpetuate duplication and inconsistency.

The recommendations of the Commission included that:

*the NFSC urge State Governments to repeal elements of their food Acts which duplicate or are inconsistent with FSC requirements;

*the NFSC request the NHMRC to delegate to the AFSC its responsibility for advising the NFSC on food standards;

*the NFSC urge all States and Territories not currently adopting amendments to the FSC by Gazettal to do so;

*a system for coordinating inspection of foods and food processing Australia-wide for compliance with the FSC be introduced; and

*conformity with the State food acts and the FSC be made a requirement of Commonwealth law regulating imports.

At a conference held in June 1990, the Australian Health Ministers announced that they had agreed to reform the process for setting national food standards. The announcement was made in response to a Commonwealth proposal that there be a national food authority set up under Commonwealth legislation. The Commonwealth proposed that the authority be an expert and independent body and be responsible for developing and recommending food standards to the NFSC. In addition, the Commonwealth proposed that the authority have the following objectives: to protect public health and safety; to provide sufficient information on food ingredients to enable consumers to make informed choices; and promote fair trading practices.

In a paper prepared for the Special Premiers Conference held in October 1990, a revised food regulatory system embodying a Commonwealth/State cooperative mechanism for establishing and applying uniform national food standards was outlined. The key features of the proposed food standard arrangements included:

*the establishment of a ministerial decision making body, the National Food Standards Council (NFSC);

*the renegotiation of the National Food Standards Agreement under which the States and Territories would accept, by Gazettal process, standards agreed by majority in the NFSC; and

*the establishment, under Commonwealth legislation, of the NFA that would recommend standards to the NFSC.

It was proposed that the NFA comprise a full time chair and four members (part time) appointed for a fixed term on the basis of their individual backgrounds, skills and expertise, and not as representatives of special interest groups. In addition, it was proposed that the NFA have the following functions;

*coordinate development and review of domestic food product and hygiene standards and develop recommendations for the NFSC for new or amended standards;

*coordinate domestic food surveillance;

*in cooperation with States and Territories, develop food safety initiatives;

*coordinate food recalls with States and Territories and industry;

*establish a system for rapid review and recommendation in emergency situations related to public health;

*coordinate imported foods assessment policy;

*promote uniformity between domestic and international food standards; and

*facilitate uniform interpretation of food legislation by States and Territories.

Main Provisions

The Bill will have effect six months from the day it receives the Royal Assent if it has not been proclaimed on an earlier date (clause 2).

`Food' is defined in clause 3 to include any substance or thing used or capable of being used: as food or drink by humans; as an ingredient or additive in, or substance used in the preparation of, food or drink for humans; or is prescribed.

Clause 4 makes it clear that the Bill will apply in relation to the standard of food sold, or standards in relation to activities undertaken before or in connection with the sale of food, by foreign and trading corporations; the trade and commerce in food between Australia and overseas, or among the States; food and food standards in the Territories; standards of food supplied to Commonwealth or Territory authorities and instrumentalities; and weights and measures in respect of food. This clause aims to satisfy the constitutional limits of the Commonwealth's power.

The NFA will be established as a corporation by clause 6.

The functions and powers of the NFA are contained in clauses 7 and 8 and include to:

*prepare proposals for the development or variation of standards;

*prepare draft standards and draft variations of standards and to make recommendations to the (NFSC);

*review standards;

*at the request of the States and Territories coordinate action by them to recall food under State and Territory laws; and

*develop codes of practice for industry on any matter that may be included in a standard.

Clause 9 provides that standards and variations of standards developed by the NFA may relate to certain matters including: the composition of food; the production of food; and the labelling or advertising of food.

Clause 10 provides that the objectives of the NFA will include the protection of public health and safety; the provision of adequate information relating to food to allow consumers to make informed choices; and the promotion of fair trading in food.

Clause 11 provides that the Minister may, after consulting with the NFSC, give directions to the NFA on how it is to perform and exercise its functions and powers. The NFA is to comply with directions and directions are to be tabled in Parliament.

Clauses 12-20 of the Bill deal with applications by a body or person for the development or variation of standards. A body or person may apply to the NFA for the development or variation of a standard (clause 12). Where an application is made, the NFA is to make a preliminary assessment of the application. A preliminary assessment will involve the consideration of certain matters, including whether the application relates to a matter that may be developed as a standard, or warrants a variation of a standard. After making a preliminary assessment, the NFA is either to accept or reject it. If acceptance occurs, the applicant is: to be notified of the acceptance; that the NFA will make a full assessment of the application; and that they may make submissions to the NFA on matters relevant to the application. Where an application is rejected, the applicant is to be notified and given reasons for the rejection (clause 13).

Where an application has been accepted, the NFA is to notify the public and each appropriate government agency (e.g. a State or Territory health department, the NHMRC, or prescribed Commonwealth departments or authorities) that it has received an application; has made a preliminary assessment and accepted it; will make a full assessment; how further information about the application may be obtained; and invite submissions on matters relevant to the application (clause 14).

A full assessment will involve the consideration of certain matters, including the objectives of the NFA, any relevant New Zealand standards and any other relevant matters. After making a full assessment, the NFA is to prepare a draft standard or a draft variation of a standard, or reject the application (clause 15). The NFA is to give notice to the public, the applicant, each appropriate agency and each body or person who made a submission on matters relevant to the application, that it has prepared a draft standard or variation; how further information about the draft may be obtained; that the NFA will hold an inquiry to consider the draft; and invite submissions to the NFA for the purpose of the inquiry (clause 16).

Where the NFA has rejected an application, it is to give notice and reasons for the rejection to the public, the applicant, each appropriate government agency, and each body or person who made a submission on matters relevant to the application (clause 17).

After holding an inquiry, the NFA is to recommend to the NFSC and give reasons for the recommendation, that it either adopt, reject, or adopt with variations a draft standard or variation (clause 18).

The public, the applicant, each appropriate government agency and each body or person who made a submission in respect of a draft standard or variation is to be notified by the NFA of the outcome of an inquiry (clause 19).

The NFSC, after considering a NFA recommendation, is either to adopt, reject or return the draft standard or variation to the NFA in whole or in part for reconsideration (clause 20).

Clauses 21-28 of the Bill deal with NFA initiated proposals for the development and variation of standards. The NFA may, of its own initiative, prepare a proposal for the development or variation of standard (clause 21). Clauses 22-28 will have the same effect as clauses 14-20 (see above).

The NFA may, at its own discretion, hold a public hearing as part of an inquiry into an application or proposal for the development or variation of a standard. The NFA may direct that any part of a public hearing be held in private and may prohibit or restrict publication of evidence given at an inquiry (clause 29).

Where the NFSC returns a draft standard or draft variation to the NFA for reconsideration, the NFA will have to reconsider it within 12 months of the date of receipt by the NFA of the application that gave rise to the draft standard or variation, or such shorter time as is prescribed (clause 31).

Clause 33 provides that the NFA may review a standard, of it own initiative, or at the request of a body or person. As soon as practicable after it has reviewed a standard, it is to prepare a proposal for the development of a substitute standard. The development of a substitute standard is to be in accordance with the provisions that are to apply to a full assessment of an application (see clauses 14-20 above).

Clause 35 provides that where the NFA prepares a draft standard or variation it is to make a recommendation to the NFSC concerning the draft within 12 months of the date of receipt by the NFA of the application that gave rise to the draft, or such shorter period as is prescribed. Where the NFA is of the opinion that it is not practicable to give a recommendation to the NFSC within 12 months, it may extend the period up to a maximum of six months.

Where the NFA is satisfied that the interests of any person or body will not be significantly affected, it may shorten or simplify the procedures for the development or variation of standards where an application or proposal raises issues of minor significance or complexity (clauses 36).

The effect of clause 37 will be to allow the NFA to shorten or simplify the assessment requirements for applications and proposals for the development or variation of standards. This may be done where the NFA considers that a recommendation concerning an application or proposal should be made to the NFSC as a matter of urgency to avoid compromising the objectives of the NFA. Where the assessment requirements are shortened or simplified, the NFA is subsequently to hold an inquiry into the standard or variation.

The NFA is to consist of a Chairperson; an officer of a State or Territory public health authority; three other members; and such members as are appointed for a special purpose. Members will be appointed by the Minister and may only be appointed if they have expertise or knowledge in certain fields. For example, the Minister may only appoint a person as Chairperson if satisfied that they have experience or expertise in one or more of six fields, including: public health; food science; food production or retailing; or public administration (clause 40).

The NFA is to establish a National Food Authority Advisory Committee (NFAAC), the functions of which will be to advise the NFA on matters referred to it by the NFA, the Commonwealth, and the States and Territories. The NFAAC is to consist of: the Chairperson of the NFA; one member nominated by the Department of Community Services and Health; one member nominated by the Department of Primary Industries and Energy; one member nominated by each State, Territory and New Zealand; and such other members as are appointed by the Chairperson for specific purposes (clause 42).

Clauses 55-60 deal with finance. The Minister for Finance may give directions as to how much and when appropriated money is to be paid to the NFA (clause 55). Clause 57 provides that the NFA's funds may only be used for certain purposes, including to discharge its expenses and liabilities incurred in the performance of its functions. Clause 58 provides that the NFA will be subject to Commonwealth, State or Territory taxation. The NFA will be subject to the Audit Act 1901 (clause 59).

Decisions by the NFA to reject an application for the development or variation of a standard, or to shorten or simplify assessment processes, will be subject to review by the Administrative Appeals Tribunal (clause 63).

The regulations may prescribe that fees, or a method for calculating fees, that will be payable, to the Commonwealth, by those who receive NFA services. In addition, the regulations may prescribe when and how fees will be payable, and prescribe the circumstances in which the NFA may waive fees (clause 66).

Information Sources

*Australian Health Ministers Conference, Media Communique, June 1990.

*Business Regulation Review Unit/Regulation Review Unit of Victoria, Report of an Inquiry into Food Regulation in Australia, November 1988.

*Department of Industry, Technology and Commerce, Australian Processed Food and Beverage Industry, June 1990.

*Industries Assistance Commission, Food Processing and Beverages Industries, December 1989.

*Paper Prepared for the Special Premiers Conference, Reform of Food Regulation, October 1990.

Bills Digest Service 3 June 1991

Parliamentary Research Service

For further information, if required, contact the Science, Technology and Environment Group on 06 2772420.

This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

Commonwealth of Australia 1991

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1991.